Today’s CBO budget report is out, and it tells us that the Republicans’ $1.5 trillion tax cut will increase the federal debt by…$1.9 trillion:
This comes from Table B-3 in the report. In other words, the tax cut doesn’t pay for itself. It doesn’t even partially pay for itself. It does have some positive economic feedback, but not very much, and nowhere near enough to make up for the lost revenue and the increase in interest payments:
This is not the CBO’s long-term budget report, so it only goes through 2028. During that period, spending goes up only modestly. In other words, spending still isn’t the problem. The problem is tax cuts for the rich that slash revenue and increase debt service. Put those together, and even with a modest supply-side economic benefit the tax cut still costs more than the static revenue estimate. Maybe it’s time to finally put the Laffer Curve to rest, boys.
